A country on IMF life support, yet banking on crypto: Is Pakistan following the Hamas model?

For a nation perpetually teetering on economic collapse, Pakistan’s pivot to cryptocurrencies seems, at first glance, like a desperate gamble. Reliant on International Monetary Fund (IMF) bailouts and with a financial lifeline tethered to China, a country that has outright banned crypto, Islamabad’s sudden enthusiasm for digital currencies in 2025 is jarring.

Pakistan’s economy, ravaged by inflation, dwindling foreign reserves, and a ballooning trade deficit, secured a critical $1 billion tranche from the IMF. Among the Fund’s demands: widen the tax net, formalize the informal economy, and bring crypto assets under regulatory oversight.

Officially, Pakistan framed this as a leap toward fintech innovation, youth empowerment, and improving remittance flows. But the geopolitical subtext was harder to ignore.

The shadow of FATF and terror money

For years, Pakistan has walked a diplomatic tightrope, barely escaping Financial Action Task Force (FATF) sanctions for terror financing and money laundering. Despite cosmetic reforms, India and Western observers have persistently flagged Pakistan’s porous financial oversight, especially regarding militant group funding.

Given this backdrop, the embrace of crypto—a financial instrument notorious for its opacity and decentralization—raised alarms. Analysts warned that Pakistan’s pivot could open new channels for circumventing sanctions, moving funds beyond the reach of global watchdogs.

A deal with Asim Munir in the shadows

In late April, the story took a sharper turn. Pakistan’s newly formed Pakistan Crypto Council (PCC) signed a landmark agreement with World Liberty Financial (WLF), a U.S.-based crypto firm 60% owned by Donald Trump’s sons, Eric Trump and Donald Trump Jr., and his son-in-law Jared Kushner.

What should have been a routine fintech partnership became a geopolitical flashpoint because of who was in the room: Pakistan’s Army Chief, General Asim Munir.

Munir’s personal involvement in finalizing the WLF deal was unprecedented for a commercial agreement. His presence signaled that this was more than a blockchain venture. For a country under relentless financial pressure, cultivating ties with Trump’s family business appeared to be a calculated move.

A curious timeline

Just days after the WLF-PCC agreement, on April 29, 2025, militants attacked the Indian town of Pahalgam, killing 26 tourists. The incident reignited India-Pakistan hostilities.

Amid the diplomatic fallout, Donald Trump publicly claimed to have “brokered peace” between India and Pakistan. On Truth Social, he lauded both nations’ leadership for halting aggression and floated trade incentives as leverage. He even offered to mediate on the long-standing Kashmir dispute, referring to it as a conflict “fighting for about 1,000 years.”

The timing was impossible to ignore: a family business deal in Islamabad, attended by Pakistan’s top military official, followed almost immediately by Trump’s diplomatic self-congratulations.

The “Bitcoin Shakers” model 

While Pakistan insists its crypto push aligns with FATF guidelines, experts point to global examples that challenge this narrative.

The “Bitcoin shakers” model, pioneered by Hamas, involves raising and laundering funds through cryptocurrency to evade international financial scrutiny. Groups like the Izz-Al Din-Al Qassam Brigades have used Bitcoin donations, decentralized exchanges, privacy coins, and mixers to obscure transaction trails and fund terror activities.

Despite global crackdowns, including wallet seizures by Israeli and U.S. authorities, these methods have evolved and proliferated. For a country like Pakistan, historically adept at utilizing hawala networks and front companies for similar purposes, crypto represents the next frontier in sanctions evasion.

Pakistan’s ability to route funds through decentralized platforms, beyond the reach of traditional banking oversight, presents serious security concerns—not just for India, but for global financial stability.

A calculated pivot?

Pakistan’s crypto strategy appears to serve multiple objectives:

• Economic diversification: Attracting foreign capital, especially through Trump-linked business interests, amid dwindling options.
• Financial resilience: Establishing alternative channels to bypass traditional financial systems subject to Western oversight.
• Strategic leverage: Deepening ties with U.S. power brokers (via Trump family businesses) to hedge against diplomatic isolation.
• Covert financial flows: Potentially facilitating opaque transactions for groups and activities otherwise restricted by global financial norms.

For Trump, whose personal brand has long blurred the lines between business interests and geopolitical rhetoric, the Pakistan crypto deal fits a familiar pattern. His family’s direct financial stake in WLF, juxtaposed with his sudden pro-Pakistan peace narrative, has drawn scrutiny in both Washington and New Delhi.

While neither Trump nor his family have commented on the deal’s implications, the optics are unmistakable.

With the IMF watching, FATF monitoring, and India wary, Pakistan’s crypto embrace is fraught with risk. The involvement of Trump-linked entities and the Pakistan military adds further layers of complexity.